Eliminations and consolidated financials

[barbola]

We have multiple companies. We need to consolidate financials with eliminations. How come VARS seem to have a hard time understanding know what this means?

Is there anyone out there who does this? Is it more than just reporting, do we need to change the way we are entering transactions, posting accounts, sales/purchases between companies, use intercompany module? etc etc

thanks.

 

[RickSchultz]

Barbola,

I wondered about that, too. I've seen a few ways around it.

First eliminations. I'm used to the easiest approach, where we enforced one-to-many relationships between companies, rather than many-to-many. If you require many-to-many relationships, you've got a nightmare on your hands.

If you use IC in GP, then every "eliminateable" transaction should have an offset in the other company, and that offset should be an intercompany account. From a reporting perspective, just leave out your intercompany accounts from your consolidated report, as they should conceivably balance.

Of course, that only works cleanly for the balance sheet. If you have intercompany sales, one way to remove them is to code the intercompany transactions to a unique segment, and remove this segment in your consolidated reporting - that would take out the revenue and expense sides of the equation.

If you use multiple currencies, that's your second problem. Do you use the current method or temporal method?

This could be a lengthy discussion; feel free to email me at rschultz@100wattsolutions.com for more ideas.

 

[barbola]

We don't have the IC module. This is more for reporting only. We need to be able to report on percentages of ownership between various companies.

It is a lengthy discussion, that's for sure. I can't even explain exactly what we need and having a hard time interpreting what our accountants want as well. It would be nice to have a setup in place so that reports would just "work" (in a perfect world).

I think we have to look at this from the reporting side and not from the transaction side.

thanks.